More than two years after signing a deal that made Windows Phone the exclusive smartphone platform at Nokia, and eventually made Nokia the dominant Windows Phone vendor, Microsoft has bought Nokia's phone business and licensed its patents for a $7.2 billion.

Here are some initial thoughts on the deal.

Microsoft admits that Apple and Google were right. After playing around for a couple years, it appears that Microsoft believes its best shot at being competitive in the smartphone space is to ape Apple and own a set of integrated hardware-software-services experiences. Google made this same decision two years ago when it bought Motorola for $12 billion. It may be too late, but at least Microsoft will put its full resources into this battle.

Owning Nokia won't fix Windows Phone's flaws. I spent about six months using a Windows Phone from HTC as my primary device, and while I liked the operating system itself, I finally gave it up and went back to my iPhone for two reasons: apps and services. This acquisition doesn't change those flaws. Owning Nokia won't help Microsoft convince app makers or developers to treat Windows Phone any more seriously today than they did yesterday; they'll still build for iOS and Android first because that's where the opportunity lies. Only market share gains will get more developers on board. Likewise, the problems with Bing, Xbox Music, and other Microsoft-run services will not be solved by owning a phone maker. That said, this isn't a short-term move. I think this is part of a thought-out strategy to position Microsoft for the next decade or two.

What about a Windows Phone tablet? Rumors recently surfaced that Nokia is building a Windows RT tablet. But what if the tablet actually runs Windows Phone 8 instead? That would let Microsoft test whether the Apple approach -- upscaling a mobile operating system for a bigger screen -- would work with Microsoft's own platforms. As I've argued before, consumers have shown pretty clearly that they don't want a desktop operating system shoehorned into a pure touch device. There may still be room for great hybrid devices that are used mostly as laptops with occasional touch screen uses, and Microsoft can keep experimenting with Windows 8 and Surface, trying to find that right fit. But in the meantime, a tablet running Windows Phone -- or a slight variant of Windows Phone -- would be an interesting experiment.

Forget those other Windows Phone partners. HTC and Samsung have taken a few shots at building Windows Phones, but placed most of their effort and energy into Android. With this move, kiss those efforts goodbye. The numbers just don't make sense -- Nokia sold 7.1 million Windows Phones last quarter. All other vendors combined sold 1.6 million. (Yes, Google's Android partners kept making Android phones after Google bought Motorola, but Android was a dominant operating system and they were already shipping millions of handsets, even if most partners other than Samsung weren't making much money at it.)

The best chance for Windows Phone is feature phone users in emerging markets. One of Nokia's strongest assets has been its historic strength in developing markets. A lot of that momentum has been blunted by Android's rapid rise, particularly in China, but Nokia is still the second largest phone maker in the world, and a well-respected brand. Just last quarter, Nokia sold 61.1 million phones around the world. Of those, 53 million were feature phones. Over time, all of those consumers are going to become smartphone buyers. This is Microsoft's best chance to make Windows Phone a player.

What about Xbox? When the acquisition is completed -- expected in 2014 -- Stephen Elop would be in charge of the Xbox business. That's a very strange fit, and I wouldn't be surprised if Microsoft tries to find a buyer for that business.

More shoes to drop. This buy has the feel of a well-planned event. Microsoft and Nokia were said to be close to a deal a couple months ago, and Ballmer reportedly told New York Times reporter Nick Wingfield that the companies started talking most recently back in February. The rapid succession of events -- a major reorganization announced in July, Ballmer's retirement announcement less than two weeks ago, the Value Act board seat concession on Friday, and this on Monday -- sure makes it seem like something big and dramatic changed in Microsoft's thinking a few months back, and the company is now executing on a set of plans that were drawn up some time ago. Predictions tend to make idiots of reporters, but I'll go out on a limb anyway and say I wouldn't be surprised to see Microsoft buy BlackBerry (whole or in part), spin off the MSN business and perhaps other business units, and maybe make a couple other surprising acquisitions. I also think that, despite appearances, Elop does not yet have a lock on Ballmer's job. I have a strong hunch there's more to come.